Market breadth turns negative

The market wiped off early gains and were trading almost flat in morning trade. At 10:20 IST, the barometer index, the S&P BSE Sensex, was up 24.77 points or 0.07% at 35,005.79. The Nifty 50 index was almost flat at 10,526.90. Sharp decline in crude oil prices supported bourses. However, weakness in IT shares put pressure on bourses.

Crude oil prices slumped to 2018 lows on Friday, pulled down by an emerging crude supply overhang. In the global commodities markets, Brent for January 2019 settlement fell $4.68 a barrel or 7.37% to settle at $58.80 a barrel during the previous trading session.

India imports majority of its crude requirements and a decline in crude eases concerns on fiscal deficit, inflation and gives more room for the government to boost growth through spending on infrastructure.

Among secondary barometers, the BSE Mid-Cap index was up 0.07%. The BSE Small-Cap index was down 0.22%.

The market breadth, indicating the overall health of the market, turned negative from positive. On BSE, 939 shares rose and 1006 shares fell. A total of 123 shares were unchanged.

IT shares declined as rupee firmed up against the dollar. Hexaware Technologies (down 3.64%), Infosys (down 2.05%), Tech Mahindra (down 1.97%), HCL Technologies (down 1.27%), Oracle Financial Services Software (down 1%), TCS (down 1%), Persistent Systems (down 0.96%), MphasiS (down 0.9%), Wipro (down 0.8%) and MindTree (down 0.54%), edged lower.

A firm rupee adversely affects operating profit margin of IT firms as the sector derives a lion's share of revenue from exports. In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 70.47, compared with its close of 70.695 during the previous trading session.

Most FMCG shares rose. GlaxoSmithKline Consumer Healthcare (up 1.34%), Hindustan Unilever (up 1%), Dabur India (up 0.96%), Colgate Palmolive (India) (up 0.91%), Nestle India (up 0.67%), Godrej Consumer Products (up 0.57%), Jyothy Laboratories (up 0.55%), Procter & Gamble Hygiene & Health Care (up 0.27%), Marico (up 0.18%) and Britannia Industries (up 0.04%), edged higher. Bajaj Corp (down 0.22%) and Tata Global Beverages (down 0.28%), edged lower.

Overseas, Asian indices were trading higher. Trading sentiment was cautious as plunging oil prices fanned worries about a dimming outlook for the global economy. Investors also braced for a crucial meeting between US and Chinese leaders at the end of week.

US stocks closed lower Friday, pressured again by falling oil prices, which drove the indices to the second straight week of declines.

Investors also keyed in on developments in European politics, after the UK and European Union both announced progress on Thursday in outlining their future relationship after Britain exits the EU.

On the US data front, the Markit flash reading on manufacturing PMI fell to 55.4 in November, a three-month low.

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